Uri Party, “Voting Rights of Pension Funds Will Be Used in Protecting Corporate Ownership”

The Uri Party decided on November 24 to make full use of the voting right vested on pension funds put into investment for the protection of corporate ownership when a major domestic company is facing the risk of a hostile M&A by a foreign company.

Also, the plan is to have the fund management commission in charge of the pension fund be operated independently without any government intervention in order to reflect the voice of the business circle against the use of voting rights.

The Uri Party held a meeting on "Revitalizing the Capital Market" held at the National Assembly presided by the floor leader, Chun Jung-bae, along with other party policy committee members and representatives from the securities and asset management industry and agreed upon the plan.

The chair of the third policy arbitration commission, Lee Gye-ahn, said during a briefing, "The assertion by the Grand National Party and the four economic federations to limit the voting rights of the pension funds is an illiberal idea," and added, "The voting right for the pension funds needs to be exercised properly in order to protect the shareholder`s rights and interests and to enhance profitability."

Also, regarding the plans on how to use the pension funds through the "Korean New Deal" policy, the Uri Party plans to have the independent fund management organization solely responsible for investment decisions on whether to invest in social overhead capitals (SOC), securities, and real estate.

Floor leader Chun said at the meeting, "It is not of the party`s interest to use the pension funds at our convenience as the old government-administered financing practice."

Young-Hae Choi yhchoi65@donga.com